European polystyrene contracts, spot movements diverge on styrene spot fall

London (Platts)--14 Sep 2017 911 am EDT/1311 GMT

Polystyrene contract and spot prices in Europe moved in opposite directions this week, as recent falls in the styrene spot price pushed PS spot prices down, while the PS contract price moved up in line with the September styrene contract price.

The GPPS net contract price was assessed at Eur1,525/mt FD NWE Wednesday, up Eur20/mt on the week, and rising Eur180/mt from the last week of August.

But the GPPS spot price was assessed at Eur1,360/mt FD NWE Wednesday, down Eur20/mt on the week.

GPPS contract prices are currently trending at a premium of Eur165/mt to spot prices.

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This is because contract discussions have been driven by the Eur190/mt increase in the September styrene contract price. The large price rise in September was due to bullish moves in the spot market in late August as a result of Total's unexpected shut down of its styrene unit and Hurricane Harvey which created huge disruptions to production and logistics around the US Gulf.

PS contractual buyers said sellers were keen to pass on higher September costs, staying firm with offers matching the monomer contract price increase.

Contractual buyers in Southern Europe also noted difficulty securing product as logistical problems due to railway works on key routes connecting Northern and Southern Europe diminished their bargaining power.

But on the polystyrene spot market, buyers held off from buying as they waited for styrene spot prices to decline from end-August highs.

The 5-30 day forward styrene spot price fell to $1,306/mt FOB ARA Wednesday, down from $1,513/mt on September 1 on easing fundamentals.

Total was heard to have restarted styrene production in early September, while the styrene market calmed from the turmoil at the end of last month.

--Yuriko Kato,
--Edited by Jeremy Lovell,

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